Greece must restructure its debt or face a messy default By George Irvin, Special to CNN

STORY HIGHLIGHTS

• Greece is due to repay over half of its outstanding €330 billion in debt by 2015
• Irvin: More austerity will cause GDP to contract even faster
• Greece must insist on a sensible restructuring, says Irvin

Editor’s note: George Irvin is Professorial Research Fellow at the University of London’s School of Oriental and African Studies (SOAS). He is author of Regaining Europe: an economic agenda for the 21st Century, London: Federal Trust, 2007.

(CNN) –– The question of whether Greece should restructure its debt has acquired a rhetorical ring — the country has few options left. Greece is due to repay over half of its outstanding €330 billion in debt by 2015 — that compares to its earnings (gross domestic product) of just €210 billion a year in 2011, with an economy which is contracting and a workforce which is going on strike.

Furthermore, for Greece to return to a sustainable path given current market interest rates would mean doubling taxes or cutting government spending by 75%, so the country is being supported by its eurozone peers and the International Monetary Fund, because the numbers don’t stack up.

Blitzkrieg … by The Reaper

Blitzkrieg

The intrigue begins. Greece, as mentioned in the previous leg of our story, developed a hilariously democratic electoral system whereby jobs were allotted to walking ballots. As years passed, this ever-growing group of walking ballots leeched more money from the national treasury and went on strike whenever their demands for a pay rise were not met. The country’s finances were ill-used. Politicians, contractors and anyone who could dip their fingers in the honey pot, dipped not only their fingers but dove in unabashedly, disregarding the long-term impact this would have on the country as a whole. It was only a matter of time before the bubble burst. The question is why it burst and who burst it.